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United Technologies earnings hit by US tax reform in fourth quarter

Last updated: 08:43 24 Jan 2018 EST, First published: 03:43 24 Jan 2018 EST

United Technologies
United Technologies plans to repatriate US$3bn in overseas cash under the new US tax law

United Technologies Corp. (NYSE:UTX) said charges related to the US tax reforms dented earnings in the fourth quarter.

The manufacturer reported profits of US$397mln, or 50 cents a share, for the quarter, compared to US$1bn, or US$1.26 a share, in the year-ago period.

Earnings took a hit of 90 cents per share stemming from the new US tax law and United Technologies expects to make a cumulative net cash payment of US$1.5bn through 2026 on the changes.

The company plans to repatriate US$3bn in overseas cash under the new US tax law.

However, fourth quarter revenue increased 7% to US$15.7bn, beating expectations for US$15.4bn.

Sales in its Pratt & Whitney business, which makes aircraft engines, rose 12% and aerospace system sales increased 5.7%.

The group’s Otis elevators unit continued to tackle tough competition in China but growth in the US and Europe helped it deliver 6% sales growth.

The company expects full year adjusted earnings in the range of US$6.85 to US$7.10 per share, an increase of between 4% and 6.8% from a year ago.

It forecast sales of US$62.5bn to US$64.0bn against analysts’ expectations of US$63.08bn.

Shares fell 0.8% to US$134.90 each in US pre-market trading.

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